DHL’s to reduce the number of hand-over points needed to move a product to
its final destination. Customers have been
involved in an ongoing effort to outsource “noncore business or logistics-related work” to shippers for the past six
years, says Angelos Orfanos, vice president, Americas, life sciences and healthcare for DHL (Plantation, FL).
In December 2007, FedEx announced
a pilot program in collaboration with
AmSafe Bridport (Phoenix) to use
AmSafe’s compressor-driven technology
container. The temperature-controlled
shipping container “has the ability to dial
in temperatures between 4° and 25°C,”
capturing “70–80% of all temperature-controlled refrigeration products being
shipped,” claims Jeff Sitzlar, manager of
business development for FedEx.
Freight transportation giants such as
DHL, FedEx, UPS, and other 3PLs are
confronting several converging trends,
according to Orfanos. With biotech leading the way, industry forecasts from LEK
Consulting, McKenzie & Co., and
DPWN Inhouse Consulting report
growing revenues for the pharmaceutical industry’s life sciences market, he
points out.
A 2001 forecast by LEK Consulting
predicted the life sciences segment of the
pharmaceutical industry will grow at a
compound annual growth rate (CAGR)
of 12% through 2007, with the temperature-controlled portion of the segment
estimated to grow at a CAGR of 22%
during the same period, Orfanos says. A
more recent forecast by DPWN Inhouse
Consulting estimates an industry CAGR
of 6.6% through 2012, he notes.
In addition, 39% of all life sciences
products were forecast to be temperature-controlled drugs by 2007, with the
Additional trends affecting
the cold chain include the
emergence of new markets
in countries such as
China and India.
remaining 61% dry, noncontrolled
products. In 2001, those figures were
15% for the former category and 85%
for the latter. Temperature-controlled
products can include those kept at the
controlled room temperature (CRT) of
15° to 25°C, Orfanos says.
“The whole concept of maintaining
temperature during transport is a huge
part of the industry, and it’s going to
grow,” says Eric Isom, manager of warehouse operations for Sentry Logistic
Solutions (Indianapolis). The 3PL distributor operates a foreign trade zone that
allows international pharmaceutical and
biotech clients to bypass importation
regulations such as “customs, paperwork,
dues, and tariffs,” he says.
One sign of the explosive growth in
the cold chain that Isom has seen since
joining the industry in 1998 is the number
of conferences on the topic. “From 1998
up to 2001 you may have been able to
find one seminar a year that was talking
about this,” he says. “Now if you search
the Internet, I would venture to say you
could find 50 to 100.”
Many of the seminars no doubt focus
on the welter of state, federal, and global
compliance regulations governing cold-chain operations that are figuratively and
literally all over the map. Canada, for
instance, “has very strict guidelines on
their product coming in as far as the
cold-chain parts, says Isom. “In the United States, there are lot of guidelines
telling you to do it, but there’s not always
a lot of detail telling you how to do it.”
A British health official for the Medi-
When accounting for the cost of validated overnight shipping, consolidation could lower prices significantly. Photo courtesy Sentry Logistic Solutions.
